In reading many different posts on Totse as well as books I realised that what is lacking for a well-read Totse regular is a way to earn money simply and legally. This information that I am providing is worth many millions of dollars and it is with no small amount of trepidation that I unleash this most potent of beasts upon the technically-literate masses in Totse.
Trading is the ultimate way for the urban warrior to earn money for several good reasons:
You get to live out your techno-dreams. Youve suddenly got the perfect excuse for investing in wireless 3G phone streaming broadband to your laptop.
Now first some basics. This technique that im about to describe is what I like to call Blade-running. I do truly believe that in the near future this will be THE way for a seasoned hacker to keep himself in Ferraris and blowjobs. For those that believe that what im saying here amounts to joining the global financial conspiracy which is inexorably intertwined with high finance of the type that im about to describe you'd probably be right. What I'm describing is nothing short of the illuminati's technical manual for reaming the world economy while all the plebs work 10 times as hard for a fraction of the money. At the very least this will provide a new vista for how the global financial juggernaut ticks and how to snatch huge amounts of money out of thin air by manipulating it.
So youve got a P.C with Windows and a (preferably) fast Internet connection. What now? First step is to go to www.fxcm.com This will be our training ground for learning how to hack the matrix for lots of free money. When you get there go to "Quotes and Charts" on the right hand side of the screen and click on "click here". That will bring up daily FX.com. On the left hand side of the daily fx screen youll see a series of live prices starting with the Euro/USD. Click on the Eur/USD price quote to bring up the chart. If those instructions confuse you then we could be in for an uphill battle trying to learn you on this one. Just go to this link if I've already lost you: http://www.dailyfx.com/FinanceChart.html?symbol=EUR/USD
This is our bunker from which we get to snatch big dollars so let's get a little familiar with it. After you've used this for a couple of days it will be much easier. For now just realise that if you can grasp what im about to teach you you'll never have to work again, your income will be increased at least 20 fold,
and you'll suddenly be one of those folks that can travel the world and answer to no one because their passport is issued in Grenada or some other paradise where actually living there doesn't form part of the basis for being assessed as resident there. ahh Freedom.
So firstly set up your screen for business...
- You'll see a command called time scale. Click on it, highlight one minute, and click on it. This changes each "tick" on the chart to 1 minute of time. Don't worry if that doesn't make sense to you, just do it.
- Next highlight studies (blue bar), select moving averages, then select new, click. Now where it says input for moving average take away the 10 and change it to 20. Press OK. There should now be a "smoothing" green line running across the screen. More on this later.
- Now highlight studies again and select R.S.I, new, and change the value from ten to 20. Full explanation on this to follow.
That's the preliminaries for preparing your chart. The chart you're looking at takes price information from the Chicago Mercantile Exchange where the world is for sale at a constantly changing price level and converts this price data into the visual image you see. It does this in REAL TIME. Thus when you enter a position your account balance automatically updates in real time as well.
Practice using the zoom function (blue bar). Click on zoom in and highlight a section of the chart to focus on. Reverse to zoom out. In this way you can focus in on present price action and gain greater control of the process im about to describe to you.
This is a market which trades live five days a week, 24 hours a day and is thus dormant on the weekends. To see it in action the best times are during standard European and U.S business hours Monday through Friday. Avoid the Asian open, the moves are smaller and the whole market is much quieter.
I envision this whole trading thing as a kind of massive logic bomb. Imagine a computer virus that no amount of Symantec Virus apps could possibly ever destroy. That grows like an amoeba, exponentially and ceaselessly. The idea is that trading by its very nature is anarchic since location is becoming less and less of an issue. If I can trade from Nepal with little or no difference in connection speed to a guy trading from New York then the logic for having a centralized city like New york starts to evaporate.
To go one step further, if I can keep travelling the world using a laptop and wireless broadband streaming from a 3g phone into my laptop who do I answer to? If I can electronically shift my money from my trading account to an account with a debit card utilising the Cirrus Maestro system allowing worldwide withdrawals in the local currency whose responsibility is it to monitor those flows? Throw some good 128 bit encryption into the mix and your starting to make life very difficult for the powers that be to ass ream you.
Put simply this whole trend towards world government is a reflection of the fact that if I leave Australia for example, the government has no jurisdiction overseas to tax me or generally interfere with my life. If I'm not resident anywhere no one has any claim over me and that drives government crazy. The solution? What about a world government with the ability to tax globally rather locally? Get the picture?
So thus my only condition in sharing with you this information is that if you get it down pat and start to ream the dollars that you teach 5 other people how to do it. In this way it shoould spread exponentially and overwhelm all efforts at containment.
Also if you do get good and profitable then you should invest some time in looking into tax free countries @ www.escapeartist.com or www.privacyworld.com. Since paying 50 percent of your earnings to a government whose violations of your civil rights and privacy are well documented on this website, should make you feel sick to the stomach. The list of such countries is long and distinguished. You don't need to live with a remote nomadic hilltribe in the Congo to get a tax break. Some good examples : Canada, Ireland, Switzerland, Netherlands, Bahamas are all tax free and yes you can escape the government if you live in America. It's the one exception to the rule since they tax you even if you expatriate yourself but it can be done if you're determined.
Anyway I digress. So you've got your chart set up as I mentioned. Now what?
Well firstly you should open a demo account through the same website:
www.fxcm.com. This will get you familiar with the execution software and will enable you to back your own judgement with paper money. I should mention that I would never use this program for real life trading. It's simply too clumsy and expensive. Use www.interactivebrokers.com instead. It's much cheaper for reasons that I won't expand on for the time being lest we get snowed under in detail.
Interactive brokers also offers a demo account of its software which would be ideal to practise paper (demo) trading on. The market we are trading is Currency Futures. This is a list of the contracts you can trade through outfits like interactivebrokers: http://www.apexfutures.com/contract.htm
Two things to note:
- Minimum fluctuations: this tells you how much each "point" is worth. For EU/US for eg. each point is worth $12.50. The market regularly runs 50 points in 10 minutes in one direction which if you held one contract would make you a profit of 50 times 12.50=625 dollars.
- Inital and maintanence margin: this is how much you must have in your account to open and maintain 1 contract. So for the EU/US contract you need to have 3240 dollars us to open the position and your account balance cannot fall below 2400 dollars otherwise the position will be closed. In this way you can trade 125000 worth of currency with just 3200 dollars. This is one contract with each point being worth 12.5 dollars.
Execution is instantaneous or pretty close to it. So you can open a position and close it again in a split second.
So the 2 peices of software required are the charting program which is free and the execution software which I recommend I.Brokers for. If you want to get your feet wet and trade for say 1 dollar a point instead of 12.50 per point go to oanda.com where you can open an account for 200 dollars us and the spread is only 2 points (on fxcm its 5).
Looking at the chart again its now time to to start "tracking" price movement. To do this go to the 'Lines' command, scroll down to 'add' and select freehand. This enables you to draw trendlines which are crucial to low risk trading. To draw a trendline go to a peice of price action, select the lowest point and run a line form it so that it takes in all of the action above it. This is difficult to explain and constitutes the first hurdle in trying to teach trading via the written word. This is a picture which should illustrate what Imean by drawing a trendline:
This is one of the most crucial aspects of successfull trading. Understanding why the market moves the way it does all comes down to the understanding that the market is always in the midst of trending. For our purposes we're interested in the very short term movement. That is the trends that develop in one minute increments. By drawing some lines on the one minute price chart you should begin to realise that safe trading is about always being on the right side of the line since this line "ramps" prices up or down depending on whether the price is in an uptrend or a downtrend. As long as price doesn't break the uptrend line for example and remains to the left of it the price will go higher and higher until the trend runs out of steam and the line is broken. This cannot be over emphasised enough. If what I've just said sounds confusing just keep going back over it until you understand it thoroughly. Its vital that this is understood before we move forward.
In terms of why currency and not say gold or stocks?
Well currency is the biggest market in the world and the moves are the purest and longest. A lot of other markets are full of manipulations and faking out that are costly and time-consuming to work out. The currency market is used primarily by the banks for hedging international funds and as such there is very little trickery. These are the currencies of major trading blocks -- not some fly-by-night dot-com so the action is very straightforward.
More to come...